Health plays an essential part in a person’s life. Bearing in mind the uncertainties, securing finances for the betterment of health treatment becomes crucial. Again, no matter how much we earn in a lifetime, it might not be enough to cover the costs of unexpected medical emergencies. This is the reason today why people opt for health insurance plans.
It is good to have a comprehensive health plan, but owning life insurance along with a health insurance plan gives you and your family more benefits as well as financial security. One of the benefits of having insurance plans is that they reflect well on your investment portfolio, directly or indirectly.
Let’s go ahead and compare health insurance and life insurance plans and see the benefits that they can offer you together.
Health Insurance v/s Life Insurance
As we all know, both health and life insurance policies work differently. Health insurance, as the name suggests, offers comprehensive coverage towards your medical costs, like hospitalisation, medicinal expenses, illnesses, and treatment of diseases. The payout in health insurance is subject to the sum assured. Not all regular health insurance policies, but if you choose the personal accident coverage, you are entitled to claim for death benefits.
On the other hand, life insurance offers you a life cover and takes care of your family’s monetary needs after your death. Additionally, this type of insurance also helps you save for your retirement and your children’s future.
Health insurance allows an insurer to claim a deduction of up to ₹25,000 on the premiums paid under Section 80D. Furthermore, you can also get a tax reduction on preventive health check-ups every year.
In the case of life insurance, tax deductions on the premiums paid annually are applicable under Section 80C of the Income Tax Act 1961; you are exempted of up to ₹1.5 Lakhs annually.
What is Health Insurance?
A health insurance plan is a contract where the insurer pays for specified medical expenses in return for a premium. Depending on the plan, it can cover hospitalisation, day-care procedures, prescribed treatments, and sometimes OPD, subject to the sum insured, policy terms, and exclusions.
What is Life Insurance?
Life insurance provides a financial payout to your nominee if you die during the policy term. Some plans also offer maturity benefits or savings components. The primary purpose is to replace lost income, repay liabilities, and secure long-term goals such as education or housing for the dependants.
Benefits of Having Both Health and Life Insurance
Let’s see the benefits that a person can obtain when both are combined.
Complete Financial Safety Net
Holding both plans creates a layered protection system. Health insurance manages sudden hospitalisation expenses, while life insurance ensures your family has a lump sum or income stream if you are no longer around to provide for them.
Covers Medical Costs + Family’s Future
A serious illness can cause high treatment costs and also reduce your earning capacity. While health insurance plans in India help pay medical bills, a life insurance plan cover (preferably term insurance) protects long-term goals such as children’s education, home EMIs, and everyday expenses if you die during the policy term.
Better Risk Management
Health and life risks are different. Health insurance manages the risk of high medical expenses; life insurance manages mortality risk. Owning both avoids over-reliance on savings and reduces the chance that one unexpected event will derail your overall financial plan.
Tax Benefits (80C & 80D)
In India, premiums for:
- Health insurance is eligible for deduction under Section 80D (limits depend on the age of insured persons, with higher limits for senior citizens).
- Life insurance qualifies for a deduction of up to ₹1.5 lakh per year under Section 80C, subject to conditions.
These deductions can reduce your taxable income while you stay insured.
Peace of Mind & Long-term Security
Knowing that hospital bills are covered and your family has a financial cushion if something happens to you reduces stress. It also allows more disciplined investing because you do not need to keep excessive emergency funds for health or mortality risks.
How to Choose the Right Combination of Plans
Assess Your Financial Needs
Before selecting any coverage, evaluate your family’s financial responsibilities, existing savings, and the level of protection you need.
If your priority is to safeguard your family from income loss due to an unexpected event, life insurance plans offer essential long-term support. If rising medical costs concern you, choosing comprehensive health insurance plans in India ensures that hospitalisation, treatment, and emergency care are covered without affecting your savings.
Compare Coverage and Premiums
Once you identify your needs, compare different health insurance plans and life insurance plans across insurers. Check the sum insured, inclusions, policy limits, and renewal conditions.
For health insurance plans, pay attention to features such as pre- and post-hospitalisation coverage, cashless network hospitals, and waiting periods. For life insurance, review the policy term, payout type, and premium affordability. A balanced comparison ensures that the combination you select offers adequate coverage without overspending.
Check Additional Riders
Riders enhance the usefulness of both life and health insurance plans. Critical illness riders, accidental death benefits, waiver of premium, and hospital care riders can add extra financial protection at a low cost.
When choosing health insurance plans in India, riders for maternity, OPD care, or personal accident cover can fill important gaps. Selecting the right riders ensures that your plans provide broader, long-term protection for different life stages.
Final Thoughts
Combining life and health insurance plans is a wise decision. The only care that you must take is to ensure that all terms and conditions, including exclusions, are correctly read and understood before signing the papers. With the right life insurance and health insurance plans, the rest of the life journey becomes much smoother. Check out: https://manipalcigna.com/ for details on various health insurance plans in India.
FAQs on Life & Health Insurance
Why should I take both life and health insurance?
Because they cover different risks. A health insurance plan pays medical bills; life insurance supports your family if you die. Having both ensures you do not have to depend only on savings for emergencies or for your family’s long-term financial security.
Can I buy them from different companies?
Yes. You can buy health and life insurance from different insurers. Many people do this to access better features or premiums in each category. At claim time, you simply contact the relevant insurer, provided you have disclosed accurate information in all proposals.
Do I get tax benefits for both?
Yes, subject to current tax laws. Premiums for health insurance plans in India can be claimed under Section 80D, and life insurance premiums under Section 80C (up to the prescribed limits and conditions). Always check the latest rules or consult a tax professional before relying on specific amounts.
Which one should I buy first?
If you have dependants and a limited budget, a term life plan is usually the priority, because it protects your family’s basic financial needs. Health insurance should follow quickly, especially if your employer’s coverage is small or temporary. Ideally, you should not delay either.
Is it expensive to maintain both?
Basic term life insurance is usually affordable, especially when bought young. Health insurance premiums vary with age, coverage, and medical history. When planned early and chosen carefully, maintaining both is often cheaper than funding large hospital bills or leaving the dependants unprotected.
